Nicaragua · Taxes
Nicaragua taxes for US citizens
Source-checked15 sources, 9 officialHow we checkIn brief
Tax is territorial, so a retiree's US pension, Social Security and interest aren't taxed. Remote work done in Nicaragua is taxed: 20% of gross pay at first, up to 30% after 180 days.
In short: what you'd pay in Nicaragua
Retiree on US income
US Social Security, pensions and US interest aren't taxed, however long you stay.
Ballpark: $0 a year
Remote worker paid from the US
Work done in Nicaragua is taxed even if it's paid from the US: 20% of gross pay at first, up to 30% after 180 days.
Ballpark: About $3,000 on 90 days of a $60,000 salary; about $16,200 all year
Working for a local employer
Residents pay 0–30%, with about $2,700 a year tax-free. Non-residents pay 20% of gross pay.
Ballpark: Residents 0–30%; non-residents 20%
Not yet verifiedRead in a 2018 copy of the tax law; later changes aren't read in full.
How Nicaraguan tax works
- Tax residence: more than 180 days in a calendar year.
- What's taxed: only income from Nicaragua, for residents and non-residents alike. Work done here counts, wherever you're paid.
- Filing: how someone paid only by a US employer files and pays is Not established yet
- No US tax treaty or Social Security agreement: Nicaraguan tax paid may be credited on your US return; see a tax adviser.
- Your US return: you still file every year, wherever you live.
Sources (10)
Links
- Ley 822, Ley de Concertación Tributaria (Asamblea printout 20/11/2018, WTO-hosted copy)
- IRS: 2026 inflation adjustments
- IRS: US citizens and resident aliens abroad
- IRS: foreign earned income exclusion
- IRS: foreign tax credit, how to figure the credit
- IRS: FICA tax rates (Topic 751)
- IRS: US income tax treaties A to Z
- SSA: international Social Security agreements
- SSA POMS GN 01701.005: totalization agreements in force
- IRS Publication 915: Social Security benefits
Nine worked examples, 2026
The retiree has $30,000 of Social Security, a $40,000 private pension and $20,000 of interest. Each person spends 90, 182 or 365 days of 2026 in Nicaragua.
| Who | Days in Nicaragua | Nicaragua income tax | US income tax, before credits |
|---|---|---|---|
| Remote employee, $60,000 | 90 | $2,959 | $5,020 |
| Remote employee, $60,000 | 182 | $7,132 | $5,020 |
| Remote employee, $60,000 | 365 | $16,157 | $5,020 |
| Remote employee, $150,000 | 90 | $7,397 | $24,734 |
| Remote employee, $150,000 | 182 | $20,595 | $24,734 |
| Remote employee, $150,000 | 365 | $43,157 | $24,734 |
| Retiree, $90,000 | 90 | $0 | $8,348 |
| Retiree, $90,000 | 182 | $0 | $8,348 |
| Retiree, $90,000 | 365 | $0 | $8,348 |
Don't add the two columns: credits and the foreign earned income exclusion can cut the US part.
Not established yetHow the first 180 days are taxed once you become resident.
Sources (12)
Legal basis and exact figures
- Law: Ley 822, Ley de Concertación Tributaria (2018 Asamblea printout): arts 3, 5, 10 (territorial; Nicaraguan-source even if paid abroad), 7(1) (resident after more than 180 days), 12 (work done in Nicaragua), 20 and 24(3) (non-residents 20% of gross), 23 (residents: 0% to C$100,000; 15%; 20% over 200,000 plus C$15,000; 25% over 350,000 plus 45,000; 30% over 500,000 plus 82,500).
- Rows: non-resident 20%: USD 2,958.90 (60k), 7,397.26 (150k). Resident at C$36.6243: USD 7,132.30 / 16,156.96 (60k at 182 / 365 days), 20,595.32 / 43,156.96 (150k); renta neta = gross allocation, no INSS or other deductions. Filing for foreign-paid workers (arts 28-29) not established. PwC (reviewed 04/08/2026) lists the same table and rate.
- Retiree $0: US Social Security, a US pension and US interest aren't Nicaraguan-source (arts 10, 12, 16). Not a claim of 0 INSS, municipal or other levies. Later reforms (Ley 987 of 2019, 2024, Ley 1279 of 2026) not read in full.
- Treaties: none (IRS A-Z, 03-Jan-2026; SSA POMS GN 01701.005, 17 Sep 2026). Freelancers' exported services are Nicaraguan-source activity income (art 14(1)); not modelled.
- US side: US figures are federal income tax before the exclusion and credits; employee FICA is extra ($4,590 on $60,000; $11,475 on $150,000). No totals: local social security contributions aren't established.
Links
- Ley 822, Ley de Concertación Tributaria (Asamblea printout 20/11/2018, WTO-hosted copy)
- BCN press note: official rate C$36.6243 per USD for 2026 (20/10/2025)
- PwC Worldwide Tax Summaries: Nicaragua, taxes on personal income
- IRS: 2026 inflation adjustments
- IRS: US citizens and resident aliens abroad
- IRS: foreign earned income exclusion
- IRS: foreign tax credit, how to figure the credit
- IRS: FICA tax rates (Topic 751)
- IRS: US income tax treaties A to Z
- SSA: international Social Security agreements
- SSA POMS GN 01701.005: totalization agreements in force
- IRS Publication 915: Social Security benefits
Other Nicaragua guides
Every rule with its legal source.
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